ComplyAdvantage raises $8.2M Series A to help firms manage compliance

Back in the days when I did a startup I almost de-railed our VC funding after discovering my passport had expired. Without it I couldn’t pass the anti-money laundering checks imposed on the fancy and overpriced London law firm we’d hired. Then we almost failed to open a bank account so we could actually receive the money because we were unable to fly over all of our investors from Eastern and Central Europe to pass ID checks in person. The takeaway: compliance is a pain in the ***.

Enter ComplyAdvantage, a London-based startup that claims to use artificial intelligence and machine learning to help firms manage compliance obligations and at reduced cost. The young company is announcing $8.2 million in Series A funding led by Balderton Capital, money it plans to plough into growth across Europe and the U.S., including opening a New York office this week.

Founded by Charles Delingpole, who previously founded Market Invoice, ComplyAdvantage originally launched with to help a small number of businesses meet complex anti-money laundering (AML) and counter financing of terrorism (CFT) requirements. It has since developed its product to also cover things like Politically Exposed Persons (PEPs) lists and other risk and compliance areas that are hard to scale.

“Legacy technologies are outdated, expensive and inefficient, typically generating large amounts of manual work in the form of unnecessary risk alerts for the team to review,” he adds, citing as an example a customer having the same name as a completely different Politically Exposed Person (PEP). “Furthermore, the criminals are winning, with existing solutions having limited impact on actually reducing financial crime”.

That, argues Ball, has left compliance officers jaded. Originally attracted to the role of fighting crime, they find themselves often doing a box-ticking exercise that is ineffective but designed to keep the companies they work for on the right side of the regulators, even if that too often fails. Meanwhile, regulator fines are kind of expected and baked into the pricing models of financial services.

To fix this, ComplyAdvantage is betting that AI and machine learning can help compliance scale properly and says the startup is part of a “regtech revolution” that is coming to financial services. “ComplyAdvantage are at the forefront unleashing the power of AI and ML to change the way compliance is done,” says the VP of Sales & Marketing.

Adds Tim Bunting, General Partner at Balderton Capital, in a statement: “We believe that this is one of the few remaining large industries that is still ripe for digital disruption. We are thrilled to be backing Charles and his team, they are well on their way to changing the way companies can understand and monitor risk around their clients. Their mission is truly exciting, and relevant to all businesses.”